Keeping the roof over your head in difficult times

Repossessions are rarely out of the news and for thousands of people in the UK with debt problems, losing their home is their biggest fear.

If your finances are getting harder to manage and you can’t tighten your belt any more, then seeking debt advice immediately could have a big impact on what happens to your home.

Reduced payments
If you’re finding it impossible to pay all your monthly bills in full when they’re due then a debt management plan involves negotiating a reduction in the amount you have to pay. This means you’ll be paying less on your unsecured debts which could make paying your mortgage more manageable.

Flexibility
One of the most appealing aspects of a debt management plan is its flexibility. If your financial situation changes for the better once you’ve entered into the plan, then you can then resume your full payments which will prevent any further action being taken by your creditors. A recent Panorama programme highlighted how unsecured debts can escalate and effectively become secured loans if they are ignored.

Other debt solutions
The other main types of debt solution which have the potential to impact on your home are IVAs and bankruptcy.

IVAs – Under the terms of an IVA, you will have to release any available equity in your home for the benefit of your creditors. This is usually done towards the end of your arrangement and could mean having to remortgage or raise a significant sum from another source in order to be able to avoid selling your home.

You can still take out an IVA if you’re living in rented accommodation and the above would not apply.

Bankruptcy – If you’re declared bankrupt then you lose control over what happens to your home. The Trustee has the power to sell your house in order to pay your creditors part of what they’re owed. Bankruptcy could also mean losing your job and the damage to your credit rating would make it difficult to get back on the property ladder. A record of your bankruptcy will stay on your credit file for six years and may make it difficult to get an affordable mortgage.

If you’re concerned about your debts mounting up and how you’ll be able to pay them each month then taking decisive action and seeking debt advice now could help you avoid losing your home.

To find out more about any of our debt services, call us free today on 0800 043 4747 or find out how you can benefit from a debt management plan.